Mexico Hog Markets

MEXICO - Mexico continues with the production holes due to old Porcine Epidemic Diarrhoea (PED) outbreaks and new PED outbreaks in Central Eastern Mexico, write Carlos A. Peralta - President and
R. Carlos Rodriguez – Vice-president of Genesus.

July farm grain prices were: i) corn at $3,340Mx/Ton ($247 USD), 12 per cent cheaper than 30 days before in Mexican Pesos and 8.6 per cent in USD. ii) Sorghum $3,150 Mx/Ton ($233 USD), cheaper in terms of USD due the exchange rate, and iii) soybean meal $7,780 Mx/Ton ($576 USD), 4.7 per cent cheaper than June, all those products are cheaper than previous report.

The life slaughter price for Mexico City metropolitan area is $42.42 Mx/Kg ($2.40 USD/Kg), in Mexican Pesos 9 per cent higher than previous month and 6 per cent higher in USD. Mx-USD exchange rate during last week was $13.50 Mx-$1.00 USD.

This Exchange rate has been caused by the “New Tango Effect” originated by Argentinean Government when they didn´t paid their External debt. Average production cost during last 30 days was $ 18.50 Mx/Kg, obtaining $13.92 Mx/Kg as profits/Kg or $1,600 Mx per slaughter pig ($118.50 USD).

We estimate the slaughter price could go up to $35.00 or $36.00 Mx/Kg (2.63 to 2.71 USD/Kg) during the last quarter 2014 and the first two months of 2015.

Mexico continues with the production holes due to old PED outbreaks and new PED outbreaks in Central Eastern Mexico. At the same time some large pig producers are in a real production expansion due to the business opportunity they see which is related to the lack of availability and future low grain prices.

The General Director of “Granjas Carroll de Mexico” (GCM), Dr. Victor Ochoa, announced a 60 million dollar investment in the construction of a new Slaughter and Packing plant. These facilities will slaughter and process 3,000 hogs per day. The investment is related with GCM vertical integration policy and with the intention to be much more competitive in the National and International markets.

On the other hand, “Kuo Group”, owner of “Grupo Porcicola Mexicano” (GPM) and Kekén, announced their excellent results during the first quarter of 2014 and which are based on the good results from these two Companies.

The Mexican Minister of Agriculture (SAGARPA) integrated working groups between pig producers, businessmen, academics, Research & Development Institutions, Pharmaceutical Industry, Feed producers, and SAGARPA with the principal intention to implement better public policies to advance in the regulation body of rules of the pork meat, accessible financial scheme, sanitary actions and export market strategies, basically with the international recognition of Mexico as free of Classic Swine Fever and Diarrhea Epidemic Porcine (DEP) prevention actions.

Mexican Pork Meat Consumption:

According with Mexican Pig Producers Council (CMP) during the last year Mexico suffers a reactivation of the pig meat consumption from 15.5 Kg per capita in 2010 to 16.6 Kg in 2013.